U S Physical Therapy (USPH) risk factors, FY2025 10-K

RISKS RELATED TO OUR BUSINESS AND OPERATIONS

1. 01Decreases in Medicare reimbursement rate may adversely affect our financial results
2. 02The Medicare program reimburses outpatient rehabilitation providers based on the Medicare Physician Fee Schedule (“MPFS”). For services provided in 2026, we expect our reimbursement rates under the MPFS to increase by approximately 1.75% as compared to the applicable reimbursement rates during 202530% rewritten
3. 03Revenue we receive from Medicare and Medicaid is subject to potential retroactive reduction
4. 04We depend upon reimbursement by third-party payors29% rewritten
5. 05Our facilities are subject to extensive federal and state laws and regulations relating to the privacy of individually identifiable patient information
6. 06We are subject to risks associated with public health crises and epidemics/pandemics
7. 07We expect the federal and state governments to continue their efforts to contain growth in Medicaid expenditures, which could adversely affect our revenue and profitability
8. 08As a result of increased post-payment reviews of claims we submit to Medicare for our services, we may incur additional costs and may be required to repay amounts already paid to us
9. 09An economic downturn, state budget pressures, sustained unemployment and continued deficit spending by the federal government may result in a reduction in reimbursement and covered services
10. 10We may be required to comply with put rights in certain of our acquisition agreements, related to a potential future purchase of significant equity interests in our existing subsidiaries or a separate company
11. 11Our debt and financial obligations could adversely affect our financial condition, our ability to obtain future financing, and our ability to operate our business
12. 12impose on us financial and operational restrictions
13. 13If we fail to satisfy our debt service obligations or the other restrictions and requirements in our loan agreements, we could be in default. Unless cured or waived, a default would permit lenders to accelerate the maturity of the debt under the credit agreement and to foreclose upon the collateral securing the debt
14. 14In conducting our business, we are required to comply with applicable laws regarding fee-splitting and the corporate practice of medicine
15. 15Some of our acquisition agreements contain contingent consideration, the value of which may impact future financial results
16. 16Our contractual arrangements may not be as effective in providing control over our variable interest entities as direct ownership
17. 17Impact on the business and cash reserves resulting from retirement or resignation of key partners and resulting purchase of their non-controlling interests (minority interests)
18. 18Healthcare reform legislation may affect our business
19. 19Our operations are subject to extensive regulation
20. 20coding, billing and payment for services
21. 21Our operations are subject to investigations, legal actions and proceedings that could result in an adverse impact on our business and financial position
22. 22We face inspections, reviews, audits and investigations under federal and state government programs and contracts. These audits could have adverse findings that may negatively affect our business
23. 23We may be adversely affected by a security breach, such as a cyber-attack, which may cause a violation of HIPAA or HITECH and subject us to potential legal and reputational harm
24. 24We depend upon the cultivation and maintenance of relationships with the physicians in our markets
25. 25Our business depends upon hiring, training, and retaining qualified employees
26. 26We depend upon our ability to recruit and retain experienced physical therapists
27. 27Failure to maintain effective internal control over our financial reporting could have an adverse effect on our ability to report our financial results on a timely and accurate basis
28. 28Our revenues may fluctuate due to weather
29. 29We operate in a highly competitive industry
30. 30We may incur closure costs and losses
31. 31Future acquisitions may use significant resources, may be unsuccessful and could expose us to unforeseen liabilities
32. 32Employer and other contracted customers may terminate their relationship with us which could adversely affect the business
33. 33Our use of emerging technologies, including artificial intelligence, involves inherent risksNew

RISKS RELATED TO OUR COMMON STOCK

1. 34Issuance of shares in connection with financing transactions or under stock incentive plans will dilute current stockholders
2. 35The number of shares of our common stock eligible for future sale could adversely affect the market price of our stock
3. 36Provisions in our articles of incorporation and bylaws could delay or prevent a change in control of our company, even if that change would be beneficial to our stockholders
4. 37There can be no assurance that we will continue to increase our dividend or to repurchase shares of our common stockNew